Owen v. Cohen

Brief Fact Summary. Respondent Russ Owen and Appellant Israel Cohen entered a partnership agreement to run a bowling alley. Within a few months Respondent moved for a dissolution of the business once the partners’ relationship turned sour.

Synopsis of Rule of Law. A partner can move to dissolve a partnership if another partner’s conduct undermines or breaches the partnership agreement.

Facts. Respondent and Appellant agreed to operate a bowling alley together. Respondent lent the business almost $7,000 to be repaid through profits of the business. As soon as the business started the partners had a poor working relationship. Appellant in particular contributed to the disharmony with numerous slights and constant badgering over the business affairs. Appellant went so far as to challenge the salary withdrawls from the business.

Issue. The issue is whether Respondent offered a level of proof that would warrant a dissolution of the business.

Held. The evidence presented did support a dissolution of the business. A partner may move for a dissolution of the business when another partner’s conduct negatively affects the business or another partner willfully or repeatedly breaches the partnership agreement. Appellant refused to do his share of the work required and talked of pressuring Respondent out of the business. Appellant also took money from the business above and beyond the agreed amounts.

Discussion. Appellant maintained that the differences between the partners were minor, but taken as a whole the Appellant would have been allowed to subject Respondent to harsh, belittling treatment if the partnership was forced to continue.